UK and Japan reach £18bn investment agreement

The UK and Japan have agreed an investment package under which Japanese firms will spend more than £9bn on UK infrastructure and financial services and up to £9bn on offshore wind projects. Officials said the commitments will create tens of thousands of jobs.

The agreement was announced during a meeting in London between the UK prime minister and the Japanese prime minister. Officials described the talks as productive and said the two countries also reaffirmed their commitment to the Gcap fighter jet programme.

Additional agreements Rolls-Royce will work with Japan's Atomic Energy Agency on next-generation nuclear technologies, and a technology agreement will connect UK research and development with Japanese manufacturing. Mitsubishi Estate, Mitsui Fudosan and Nomura Real Estate are among the Japanese firms that officials said have agreed to spend billions over the next five years on infrastructure and real estate projects.

Economic context The UK economy grew 0.6% in the first three months of the year, the fastest rate among G7 nations. The International Monetary Fund said last month that the US-Israel war with Iran will hit the UK harder than other advanced economies but forecast UK growth of 1.3% next year.

The Conservative shadow business and trade secretary said his party welcomed any deal that brings investment to the UK but added that tax hikes and employer rules are damaging the economy.